NEW ORLEANS—As Seattle-based Amazon moves further into the grocery space, a former AmazonFresh executive shared insights from the company's entry into consumables.
Tom Furphy, CEO and managing partner for Seattle-based Consumer Equity Partners and former vice president of consumables for AmazonFresh, shared his experiences helping transition the eCommerce giant into fresh and consumable fare during an educational session at Fresh Summit 2017.
Furphy, who also was a vice president Rochester, N.Y.-based Wegmans, said Amazon's leap into consumer goods seemed huge at the time.
“It was a big leap, but the leap into fresh was ultimately a bigger one,” he said. “Getting into the fresh food business was incredibly difficult.”
In the early days of AmazonFresh, educating customers was a key component of building the business.
“The hallmark of a great store produce operation is that they understand the product very deeply, the heritage of the product, and bring that story to life through merchandising,” he said. “We had a unique opportunity to do that at some level of scale online.”
But online has its limitations, and expectations.
“It came with a lot higher shrink,” he said. “We had an extremely high quality mark, which meant we rejected a lot of product.”
And shoppers could be unforgiving, he said. They expect every piece of produce to be exactly as perfect as the product description photo.
“That glistening, perfect leaf is how every product should look,” he said. “We all know the realities of the actual environment, and if you walk up as a shopper and the display looks impressive, you're going to feel great about what you chose and your purchase. When it comes in a tote, and you open it up and there's a scar or blemish, you'll see that and think ‘I could have done a better job picking than that.'”
What's made Amazon successful in the eCommerce business – reviews, recommendations and personalization – can translate to in-store retail through innovation, Furphy said.
“When (retail) was small stores, the produce manager knew customers and their preferences and could personalize the experience,” he said. “The algorithms in your head were enough. Today we need an additional layer of technology. If the store associate can have that information to have the interaction digitally, the customer can have more of that Amazon experience.”